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Cerberus to secure Seibu stake topping one-third

Kyodo

U.S. private equity fund Cerberus Capital Management LP will probably acquire a stake of more than one-third in Seibu Holdings Inc. via a takeover bid set to expire Friday, sources said.

Raising its stake in Seibu Holdings to more than one-third would give the New York-based company power to veto major board proposals at shareholders’ meetings, but Cerberus is not expected to reach its goal of acquiring a 44.67 percent stake, which would let the fund take the initiative in Seibu management.

Cerberus, the largest shareholder in the railway and hotel manager, had initially made a tender offer to boost its stake in Seibu from the present 32.44 percent to 36.44 percent, but the U.S. investment firm has revised the target upward to 44.67 percent.

After the takeover bid, Cerberus, which has been at odds with the holding company of Seibu Railway Co. over a plan to relist on the Tokyo Stock Exchange, is likely to exert more pressure on the company.

On Tuesday, Seibu Holdings President Takashi Goto reiterated his opposition to the takeover bid.

According to the sources, Seibu has secured support from main shareholders, including its lenders as well as NW Corp., in which former Seibu leader Yoshiaki Tsutsumi holds a majority stake.